Income Inequality Grew After the Great Recession

The Federal Reserve Bank released the results of the 2010 Survey of Consumer Finances yesterday, which looks at the period between 2007 and 2010. The big, and not surprising, news is that income inequality continued to grow despite the Great Recession. Here are a few of the findings:

Median family income decreased 7.7 percent

Median family income decreased more for non-white or Hispanic families, down 11.3 percent, compared to a 2.6 percent decline for white families

The percent of families that save also decreased, from 56.4 percent of families to 52 percent of families

The most disheartening finding is that net worth for the top 10 percent of income earners actually increased during this time, while net worth for all other income groups dropped. See the highlighted portion of the chart below. The gap between the highest and lowest incomes grew even wider. Middle income groups saw increases between 2001 and 2007, with a precipitous drop in 2010.For the bottom 20 percent, net worth has been on the decline since 2001.

These figures just provide further confirmation of what we already knew. While most people, particularly those with lower incomes and people of color, continue to struggle and suffer from the effects of the recession (and some have been struggling long before the recession) those at the very top remain protected from any real-life consequences and continue increasing their wealth. There’s only one word to describe this: injustice.

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[…] As we have covered in the past, this economic recovery has not affected all communities equally. The general fact is that the recovery is helping those high earning families, while failing to help the lower-income and minority communities. In fact, the recession caused the wealth gap between whites and minorities to increase by 20%, as reported by the Pew Research Center. This drop caused the largest wealth gap since the government began tracking this information. […]

[…] between unemployment and the ability to create generational wealth. And we have blogged about the uneven economic recovery, in which some communities have lagged far behind others and in which income inequality has […]